Students sit in a classroom doing eye exercises at a primary school for children of migrant workers in Shanghai.
Reuters
The Bank of England is unlikely to rates anytime soon because of a slowdown in China's growth and it's crazy stock market volatility, says Investec's chief economist Philip Shaw.

"What you're looking at is a domestic picture that is looking pretty good ... particularly because of the service sector, and that growth momentum is gaining gradually," said Philip Shaw, chief economist at Investec, on the BBC's Today programme.

"However, there's a less comfortable international background" he added, due to a potential slowdown in Chinese growth and stock market volatility.

The MPC will publish its latest decision on interest rates later today, alongside the minutes of meeting.

A low interest rate stimulates the economy because it reduces the cost of borrowing. In other words, it helps those in debt to make repayments and boosts the amount of money in people's pockets. This was necessary when the economy was hit by the credit crisis on 2007/2008.

As Chinese growth weakens, the country's manufacturing sector slows down and needs fewer raw materials. As demand for commodities falls, so does the price, hurting economies such as Australia that depend on exporting them. This leads back to less demand for China-made goods.

The UK economy, being outward looking for a lot of its goods, isn't out of this loop.